UK King's Speech announces legislation for the digital, data and media spheres
Published on 16th Nov 2023
Three Queen's Speech 2022 bills have reappeared on the legislative programme: will they make the statute book this time?
The Data Protection and Digital Information (DPDI) Bill, the Digital Markets, Competition and Consumer (DMCC) Bill and the Media Bill were all announced in the King's Speech on 7 November 2023. The DPDI Bill and DMCC Bill were carried over from the previous parliamentary session.
The DPDI Bill is intended to make data protection law simpler for businesses to understand and more flexible to implement, whereas the Media Bill will reform the laws regulating public service broadcasters (PSBs) and align video-on-demand regulation with that which currently regulates PSBs. The DMCC Bill aims to introduce a new pro-competition regulatory regime for digital markets to address the market power of a small number of tech firms and to give the Competition and Markets Authority (CMA) more tools to prevent harmful practices that hold back innovation and growth. It also makes significant changes to UK consumer protection law, giving much stronger enforcement and sanction powers to the CMA.
The Data Protection and Digital Information Bill
The stated aim of the DPDI Bill is to reduce data protection burdens on businesses now that the UK is no longer part of the EU (see our Insight). This includes:
- cutting down on “user consent” pop-ups and “cookie” banners;
- reducing the need for controllers and processors to keep records of all their processing;
- changing the threshold for refusing or charging a reasonable fee for a data subject request, which would be changed from "manifestly unfounded or excessive" to "vexatious or excessive"; and
- changing the circumstances in which, when seeking to rely on legitimate interests as a lawful basis for processing, an in-depth assessment to determine whether a controller's interests are outweighed by the data subject's rights is needed.
It also includes "smart data" provisions to enable ministers to order the opening up of consumer data flows in various sectors (similar to the "open banking" scheme in the financial services sector). It also includes provisions around digital identity verification schemes.
The bill represents a small step away from the General Data Protection Regulation (GDPR) as opposed to a big leap. While it is supposed to have merely clarified and simplified obligations under the GDPR, if the EU considers that it moves too far away from the GDPR, such that the UK no longer ensures an adequate level of personal data protection, the European Commission could decide to end or at least not renew its current adequacy decision. For this reason, there is potential for the bill not to reach the statute book in this parliamentary session. It is currently at the report stage in the House of Commons.
The Media Bill
This bill will significantly change the regulatory landscape for media providers. Its overall aim is to promote PSBs and national radio stations, and redress the perceived imbalance between global streaming platforms compared to UK-based media services.
A draft version of the bill underwent pre-legislative scrutiny by the House of Commons Culture Media and Sport Select Committee, including a public call for evidence that invited views on the proposals. The committee subsequently published its report, which contained various recommendations (see our Insight).
The bill proper was introduced into the legislative process the day after the King's Speech, indicating the government's intention to see it through to becoming law. The government says that it has "accepted the majority of [the committee's] recommendations".
The bill updates the legislative framework for public service broadcasting, including through digital platforms. It includes the following proposals:
- the regulation of video on demand (VoD) services will be brought into line with that of linear TV services, although the government declined to make all VoD services subject to a new VoD code of practice, as recommended by the committee; only "Tier 1" services will be made subject to the new VoD code;
- PSBs will be able to fulfil their public service remit and deliver their programme quotas through both linear broadcasts and on-demand services;
- there are provisions to ensure the prominence of public service content on online services, but the government declined to upgrade "an appropriate degree of prominence" to "a significant degree of prominence", as recommended by the committee;
- services within the listed events regime will include both TV programmes and internet programme services, thereby closing the "streaming loophole", as recommended by the committee;
- Channel 4 will be permitted to make and own its own content and proportion of programmes and the quota of programmes that it must commission from independent companies is increased from 25% to 35%.
- Ofcom will be given new powers to oversee measures Channel 4 puts in place.
Its second reading is scheduled for 21 November, after which detailed line-by-line scrutiny will follow in the Committee stage. (Visit our Media Bill Hub to stay up to date on the latest developments.)
The Digital Markets, Competition and Consumers Bill
The DMCC Bill brings sweeping reforms to competition in digital markets and consumer law.
It gives the Digital Markets Unit (DMU), which sits within the CMA, a statutory footing. The DMU will have a range of powers to regulate powerful digital firms that are given “strategic market status”, putting them under tough new rules governing their conduct and mergers, including the power to impose penalties of up to 10 percent of a firm's global turnover for breaches. The bill also amends the threshold for merger reviews, with the aim of allowing the CMA to focus on transactions with the greatest potential to weaken competition.
In relation to consumer law, the DMCC Bill will create a new regime to help consumers avoid "subscription traps", and will give the CMA stronger enforcement and sanction powers (see our Insight).
In addition, firms will have to provide pre-contract information to consumers and send out reminder notices on subscription renewal contracts within a set timeframe. They will also have to assist consumers in exercising their right to end a contract, and notify and refund any overpayments made after a cancellation.
The bill is currently at the report stage.
What was not in the King's Speech?
As previously reported, there were rumours of new legislation on artificial intelligence (AI). The House of Commons Science, Innovation and Technology Committee recommended that the UK should not just rely on existing regulation (as proposed in the AI white paper). Commentators speculated that regulators might be placed under a statutory duty to have regard to the white paper's "high level principles" to shape application of existing regulatory frameworks to AI.
Although the King's Speech included reference to the DPDI Bill as a legal framework to "encourage innovation in technologies such as machine learning", there is no sign that this is indicative of new legislation on AI. Various existing DPDI Bill provisions could affect AI systems or training data (and the data privacy regime already applies to AI). The committee has published a "disappointed" press release, apparently confirming the absence of AI-specific legislation.
Osborne Clarke comment
The inclusion of these three bills in the King's Speech may be a strong indicator that the government believes it can push them all through before the next general election. Commentators have noted that the government did not include some of its more controversial legislative proposals, such as the Mental Health Bill and the Conversion Therapy Bill.
There should be sufficient parliamentary time for the bills to pass: the new parliamentary session is expected to be a fairly normal length, with many commentators currently converging around October 2024 as a likely general election date (supported by a comment made by the prime minister at the recent AI Safety Summit).
The DPDI Bill and DMCC Bill were both a significant way through the legislative process, but both potentially have issues still to be resolved.
In relation to the DMCC Bill, there has been extensive lobbying on the question of whether to allow a full merits appeal against digital market decisions of the CMA or to allow only a more limited judicial review challenge.
On the DPDI Bill, the issue is whether the EU will consider the UK still ensures an adequate level of personal data protection.
As for the Media Bill, the government has approved most of the committee's recommendations and has given itself the maximum time possible to pass it by starting the legislative process the day after the King's Speech.
As we near a general election, the political capital around these bills is important. In particular, Brexit-related arguments may once again be in play, as each of these bills will create a divergence from the corresponding EU regime. This factor may add to the government's impetus to get them passed – unfinished legislation cannot be carried over into a new Parliament, regardless of the election outcome.
Rachel Asaker and Alex Lowe, Trainee Solicitors at Osborne Clarke, assisted in writing this Insight.